A total of thirty – seven Indian corporates raised Rs. 52,116Cr through main board IPOs in the financial year 2022 – 2023, less than half of the Rs. 1.11Cr, which is an all-time high, was further mobilized by 53 IPOs in the year 2021 – 2022, according to the data released by the Prime database.
The country’s premier database on the primary capital according to Pranav Haldea, MD, Prime Database Group, as many as 25 out of the 37 IPOs came in just three months of the year (May, November, and December) which shows the volatile conditions prevalent through most of the years which are not conducive for an IPO activity.
In fact, the Q4 of 2022- 2023 has been the lowest amount raised in the last nine years, Haldea said that Rs. 20,557Cr or a huge 39% of the amount raised in 2022- 2023 was by LIC alone without which the IPO fundraising would have been just Rs. 31, 559 Cr.
To be sure, the amount raised in 2022- 2023 is still the third highest in terms of IPO fundraising, the largest IPO in the year 2022-2023, was from a Life Insurance Corp of India that was followed by Delhivery (Rs. 5,235 Cr) and Global Health (Rs. 2,206 Cr).
The average deal size was high to Rs. 1,409 Cr. only 2 out of the 37 IPos (Delhivery and Tracxn) were from a new age technology company (NATC) (in comparison to 5 NATC IPOs raising Rs. 41,733Cr in 2021 – 2022) pointing towards the slowdown in IPOs from this particular sector.
The overall response from the public was moderate of the 36 IPOs for which data is available presently, 11 IPOs received a mega response more than 10 times (of which 2 IPOs more than 50 times) while 7 IPOs were oversubscribed by more than 3 times. The balance is between 1 to 3 times.
In comparison to 2021 – 2022, the response of retail investors moderated the average number of applications from retail investors also moderated the average number of applications from the retail dropped to just 5.64L, in comparison to 13.32 lakh in 2021 – 2022 and 12.73 L in 2020 – 2021.
The highest number of applications from retail was received by LIC (32.76L) followed by Harsha Engineers (23,86) and Campus Activewear (17.27 L), Prime Database also said, the number of shares applied for by the retail by value (41,671 Cr) was 20% lower than the total IPO mobilization (in comparison to being 17% higher in 2021 – 2022).
The IPO response was further muted by moderate listing performance; the average listing gain based on the closing price on the listing date fell to 9.74%, compared to 32.59% in 2021 – 2022 and 35. 68% in 2021 – 2022.
Out of the 36 IPOs which have got listed so far, 16 gave a return of over 10% DCX systems gave a stupendous return of 49% followed by the Harsha Engineers (47%) and the Electronics Mart (43%) twenty – one out of the 36 IPOs are trading above the issue price last closing price was on March 24, 2023.